Episode 346 – Non-Compete Policies & Expanding to New Locations
Today we’re talking with Pristine from White Lilac Cleaning company!
Pristine has an employee-client situation, where a client has asked for Pristine’s employee to do cleaning work for her. The client is interested in having Pristine’s employee clean her residential carpets and her residential building. Pristine isn’t sure she should agree to them having an outside relationship from her cleaning company. The problem is that the work is forty-five minutes outside of Pristine’s business area and is for a service, carpet cleaning, that she doesn’t offer. Should Pristine expand to that area or create a new carpet cleaning service?
My advice to Pristine is to look at the problem in two parts, policy and expansion. I’m going to have her make two separate decisions, one about her employee-client policy and the other regarding expansion.
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After she makes the two separate decisions, we’ll see if the two decisions can work together to solve the current problem.
To solve the problem of employee-client relationships, I have one correct answer and one opinionated answer. The correct answer is to have a policy that binds employees to specific rules regarding outside relationships with your clients. For example, the policy may be that employees are not allowed to work with your clientele outside of your cleaning company.
My opinion is to avoid legal documents. I’m not a fan of documents or contracts because nothing can be done to rectify a situation using them, unless you go to court. Court costs a lot of money and suing your cleaner doesn’t have much financial gain for you. If one of my employees wants to work with a client, I tell them that it is fine and we’ll start transitioning them out of their position at my cleaning company.
To solve the problem of expansion, we want to start from the foundation of Pristine’s business. She needs to ask herself, what do I want my life to look like? Cleaning company owners want to avoid asking, how can I grow the largest cleaning company in the world? This question will not make you happy or fulfilled in the long run.
Figuring out what you want your life to look like will. For example, let’s say you’ve crunched the numbers and figured out that you need a one million dollar business to have everything you want. Using residential data, you know that there are enough homes in your area to make you one million in revenue each year. This means you don’t need to expand and you can keep working on growing your clientele in this one area.
In summary, don’t make big business goals off of small situations. You don’t want to expand your company and add new services because of one employee. If doing so creates a lifestyle that you don’t want to live, it’s not worth it. If you find that your policies and expansion goals go hand in hand, then you know that it is the right decision.
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Best advice you’ve received either personally or professionally?
What’s the biggest mistake you’ve made in the cleaning business we can all learn from?
What is your favorite book?
Crazy Love by Francis Chan